Howard Marks Says Were in a the Fifth Inning of a Credit Bubble

“These days, Marks sees disquieting signs of another credit bubble, though it is just in “the fifth inning.” Central banks are pumping money into economies with abandon. And rates have descended to levels that hardly compensate investors for the risks incurred.

The leveraged buyout market, too, is heating up again, with private-equity firms willing to pay price-to-cash-flow ratios at the elevated levels of 2006, if not the absurd ratios of 2007.

Debt issuance, particularly of high-yield bonds and leveraged loans, is soaring. Individuals and pension funds, though hardly complacent about risk….”

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